Ahli United Bank posts 19 percent net profits rise

The Manama-based Ahli United Bank (AUB) has announced net profits of $32.8 million for the first six months’ period of the financial year 2002. This represents an increase of 18.7 percent over the sam

The Manama-based Ahli United Bank (AUB) has announced net profits of $32.8 million for the first six months’ period of the financial year 2002. This represents an increase of 18.7 percent over the same period in 2001, when the bank’s bottom line stood at $27.7 million. As of June 30, 2002, AUB had total assets of $4.6 billion on a shareholders' equity of $560.9 million.

Gross operating income to June 30, 2002, was $77.4 million, as compared to $73 million in first half FY2001. Cost-to-income ratio dropped during the same time from 50.5 percent in 1H01 to 43.1 percent in 1H02. Earnings per share were US cents 1.82, compared to US cents 2.14 in the corresponding period last year, based on average outstanding shares of 1.8 billion.

Capital adequacy stood at 17.9 percent on an adjusted capital base of $646 million. Net interest income rose by 11.8 percent against the same period last year. Core fee income, excluding gains on the sale of non-trading investments and other trading income, remained stable at $25.5 million, versus $26.1 million in 1H 2001.

“The trend towards steady improvements in profitability aided by growth in core operating income and cost control measures, resulting in around 10 percent reduction in operating expenses, has continued," said Fahad Al-Rajaan, AUB chairman.

"The Bank's core business segments of retail banking, corporate banking, treasury and investments, and private banking and wealth management, have all performed satisfactorily during the first six months of the year and shown steady growth in a very competitive and challenging business environment" he added.

Ahli United Bank is a fully-fledged commercial institution and investment bank providing wealth management, retail, corporate, treasury, offshore and private banking services. It is geared towards growth through the development of a larger client base in the Gulf Cooperation Council (GCC) states.

The evolution of future mergers and acquisitions remains central to the bank's expansion strategy, according to a company press release. AUB has a significant minority share in Bank of Kuwait and the Middle East (BKME). BKME has a 10 percent market share in Kuwait. BKME's profits in 2001 were $51.2 million, up from $46.3 million in 2000.

On October 1, 2001, Ahli United Bank (Bahrain), AUB's merged retail banking arm, started operations with an approximate 21 percent share of the Bahrain banking market. AUB has also established an alliance with Mellon Global Investments, to offer investment management services in the Middle East, and a strategic alliance, through its wholly owned subsidiary United Bank of Kuwait Plc with Henderson Global Investors, to become a provider of real estate investment products in the Middle East.

AUB's first share rights issue in July 2001 was over-subscribed by 111 percent when the issue attracted applications for 540.8 million ordinary shares, against the 256 million shares originally offered, resulting in $154 million in net capital proceeds. It has been the most successful rights issue on the Bahrain stock market to date.

AUB shares have been listed on the Bahrain Stock Exchange since August 2000 and are actively traded. — (menareport.com)